FACCENDA_PROPERTY_LIMITED - Accounts

The directors present the strategic report for the period ended 31 May 2018.

2017/18 was dominated by continued investment in ongoing projects both for sister companies and with our Joint Venture partners.

During the period we had four property sales. Our Joint Ventures continued to develop with steady progress being made on planning applications and permissions to unlock value in these projects.

The more significant risks and uncertainties faced by the company are consistent with the rest of the property sector:

• Commodity prices
  With ever-increasing global demand for commodities and unsettled economic conditions, we can expect market volatility to continue through the next trading year. We continue to carefully monitor input prices and work closely with suppliers to reduce the impact of volatile market movements.

• Site safety

Site safety remains a high priority. Construction sites remain dangerous places of work and require the utmost application of health and safety practices.

• Legislation

New or proposed legislation governing all aspects of the business is reviewed routinely. The business is committed to responding positively to new regulations.

• Insurances and risk management

The Group faces the risk of incidents and continues to train staff at all levels, as well as ensuring that our sub contractors adhere to the same stringent practices operated by our own management. This limits the opportunity for incidents. We also make sure that all insurances are relevant for our ongoing projects.

• Supplier contracts

It is imperative that the company is able to source its high quality raw materials, goods and services at the most competitive prices and to this end the company has numerous supply contracts in place. Contracts are collectively essential to the business but no single contract or supplier is critical.

• The outlook for the year ahead remains encouraging.

• Political and economic uncertainty in the UK will also be a factor in the year ahead.

• We remain confident in the management team, our well-invested facilities and our skilled employees to meet the challenges ahead.

The business is supported with working capital facilities provided through the parent company. This ensures that it has sufficient funding to meet the challenges of the tough market and to improve capability to access new markets for fresh products and introduce technology to improve efficiencies.

The directors consider the key performance indicators to be:

• Health and safety management
  The company is committed to providing a safe place of work for all employees and to continuously improve our safety management & surveillance systems through diligent risk assessment, high standards and active communication.

• Ethical employment
  A fair system of work with terms, conditions and facilities to match is at the heart of how the company does business and is enshrined in our company values. We strive to make Faccenda a great place to work and somewhere where everyone can make a difference.

• Employment of disabled workers

We continue to be committed to diversity in our employment proposition and, as part of this, the employment of disabled or disadvantaged colleagues is a key part of providing equal opportunity for all across our business.

• Corporate and social responsibility
  Faccenda are aware of the potential issues posed by our operations and actively look to lessen their impact. We are good and responsible neighbours with active relationships in our communities.

By order of the board

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

Faccenda Property Limited is a private company limited by shares incorporated in England and Wales. The registered office is Willow Road, Brackley, Northants, NN13 7EX.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention as modified to include investment properties at fair value. The principal accounting policies adopted are set out below.

This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:

• Section 7 ‘Statement of Cash Flows’ – Presentation of a statement of cash flow and related notes and disclosures;

The financial statements of the company are consolidated in the financial statements of Faccenda Investments Limited. These consolidated financial statements are available from its registered office at Willow Road, Brackley, Northants, NN13 7EX.

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

The current reporting period runs from 1 May 2017 to 31 May 2018 being a 13 month accounting period. The prior period ran from 1 May 2016 to 30 April 2017 being a 12 month accounting period. The figures presented in the financial statements will therefore not be entirely comparable. The current accounting period was extended to bring the group's reporting date in line with Faccenda Holdings Limited, the ultimate holding company.

Turnover represents amounts receivable from the sale of properties, goods and services net of VAT and trade discounts. Turnover is recognised when either contracts are exchanged over the sale of properties, or if the final outcome of a property development can be assessed with reasonable certainty, by including in the profit and loss account turnover and related costs as contract activity progresses.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

Tangible fixed assets are stated at cost or valuation less depreciation. Depreciation is provided at rates calculated to write off the cost or valuation less estimated residual value of each asset over its expected useful life. The annual rates used are:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. The surplus or deficit on revaluation is recognised in profit or loss.

Where fair value cannot be achieved without undue cost or effort, investment property is accounted for as tangible fixed assets.

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.

Where budgetary expectations are such that anticipated profits are sufficient to recover decelerated capital allowances, a deferred tax asset is recognised.

Certain assets have been revalued in accordance with the transitional provisions under FRS 102, deferred tax has been calculated accordingly.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

During the year Faccenda Property Limited wrote off £2,545,489 of work in progress. The balance related to Biomass work undertaken by Faccenda Property Limited on behalf of Faccenda Farms (Partnership) Limited, a company in the Faccenda Holdings Limited group. At the year end the balance was deemed irrecoverable from Faccenda Farms (Partnership) Limited, who are no longer a going concern.

The average monthly number of persons (including directors) employed by the company during the period was:

In respect of investment properties on the market at year end, fair values have been taken as the asking price of each property on the open market. In respect of investment properties not on the market at year end, the fair values have been arrived at on the basis of a valuation carried out in June 2018 by Davies and Partners, independent valuers who are not connected with the company. The valuation was made on an open market basis by reference to market evidence of transaction prices for similar properties.

The company has an unsecured loan facility with Faccenda Investments Limited. The amount available is £53,000,000 or such lesser amount as agreed. The loan facility is repayable on 1 June 2019 or earlier at the option of the company. Interest on the outstanding balance of the loan is payable at 1.75% plus base.

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

As the income statement has been omitted from the filing copy of the financial statements the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

The company, together with other members of the Faccenda Holdings Limited group, has entered into a composite accounting agreement with Barclays Bank plc, together with unlimited cross guarantees with the same bank.

In accordance with section 33.1A of FRS 102 disclosure is not given in these financial statements of transactions entered into between two or more members of the group, provided that any subsidiary which is party to the transaction is wholly owned by such a member.

Faccenda Property Limited owns a 51% stake in Northampton Road Projects LLP, a limited liability partnership registered in England and Wales. As at 31 May 2018 Faccenda Property Limited was owed £1,375,288 (2017 - £1,358,074) by Northampton Road Projects LLP in respect of profits due to members.

Faccenda Property Limited owns a 51% stake in Howes Lane Projects LLP, a limited liability partnership registered in England and Wales. As at 31 May 2018 Faccenda Property Limited was owed £5,689,726 (2017 - £793,280) by Howes Lane Projects LLP. No interest is charged on amounts outstanding at the period end.

Faccenda Property Limited owns a 51% stake in Skimmingdish Lane Projects LLP, a limited liability partnership registered in England and Wales. As at 31 May 2018 Faccenda Property Limited was owed £4,799,767 (2017 - £4,549,767) by Skimmingdish Lane Projects LLP. Interest has been charged on these loans of £236,215 (2017 - £nil) and is outstanding at the period end. In addition as at 31 May 2018 Faccenda Property Limited was owed £713,614 (2017 - £835 loss) in respect of profits due to members.

Faccenda Property Limited owns a 51% stake in Banbury Road Projects LLP, a limited liability partnership registered in England and Wales. As at 31 May 2018 members capital of £51 (2017 - £51) was owed to the LLP and Faccenda Property Limited was owed £15,468 (2017 - £14,468) by Banbury Road Projects LLP. No interest is charged on amounts outstanding at the period end.

Included within trade creditors at the period end are amounts owed by Faccenda Property Limited to various trusts in which the directors have an interest or have influence. During the period recharges were made to I. J. Faccenda totalling £489,624 (2017 - £738,894) of which £nil (2017 - £nil) was outstanding at the period end. Interest is not charged on amounts outstanding. Recharges were made to H. A. Faccenda of £nil (2017 - £6,120) of which £nil (2017 - £nil) was outstanding at the period end. Recharges were made to J. Faccenda, wife of I. J. Faccenda, of £nil (2017 - £267,984) of which £nil (2017 - £nil) was outstanding at the period end.

During the period recharges were made by Faccenda Property Limited to The Hillesden Trust, in which the directors have an interest, of £6,202 (2017 - £6,597,571). At the period end there is a balance of £nil (2017 - £6,202) included in trade debtors owed by The Hillesden Trust, for the recharge of expenditure incurred in the period. Interest is not charged on amounts outstanding. In addition recharges were made to The Goodhart Trust, in which the directors have an interest, of £nil (2017 - £559) of which £nil (2017 - £nil) was outstanding at the period end.

During the period recharges were made to Faccenda Property Limited from Faccenda Foods Limited, in which the directors have an interest, of £103,198 (2017 - £325,238). Recharges were made to Faccenda Foods Limited of £1,862 (2017 - £1,001,013) and properties were purchased from Faccenda Foods Limited for £6,155,000 (2017 - £nil). Rent was paid to Faccenda Property Limited by Faccenda Foods Limited of £2 (2017 - £nil). At the period end Faccenda Property Limited was owed £nil (2017 - £65,984) by Faccenda Foods Limited.

Throughout the preceding year and at the beginning of the current period, the company's immediate and ultimate parent company was Faccenda Investments Limited. On 30 August 2017 Faccenda Holdings Limited became the ultimate parent company. Faccenda Investments Limited and Faccenda Holdings Limited are incorporated in England and Wales. Copies of the consolidated financial statements of Faccenda Investments Limited and Faccenda Holdings Limited are available from the registered office at Willow Road, Brackley, Northants. NN13 7EX.